Legislative Update - 2025 Week 4

Last week was a busy week for the rental housing industry. Bills are starting to move now and there are a lot of pieces of legislation concerning housing. 

Two of our top issues had committee hearings last week. 

The first was HB 337 sponsored by Jordan Tuescher, (R), West Jordan. This bill directs the division of real estate to create a new property management license and a separate set of regulations for property management. Currently, anyone who does third-party property management (managing another owner’s property for compensation) is required to have a real estate sales license, despite the fact that that license has minimal training for property management.  

Roughly half of the 350,000 rental units in Utah are managed by their owner and therefore no real estate license is required. But for the other half, sometimes having a real estate license is a burden (because it places restrictions on operations that owner operators don’t have) and onerous, because it makes someone have 120 hours of sales training, even if they never intend to do any real estate sales.

A report from the office of professional license review, set up by the legislature to review all occupational licenses, concluded in early 2024 that a new license is needed to allow the thousands of operators who don’t do sales an alternative path to licensure and provide better, more relevant property management education.

The bill itself is a first step and will be followed by regulation created by the division of real estate. 

On Thursday, the bill was presented to committee and passed unanimously. In fact, many committee members expressed opinions that they would like to see licensing requirements reduced even further for property management. 

We will work with the division of real estate this summer to craft rules and education requirements for the new license, and will create an entirely new set of property management only regulations. One current problem is the current regulations are geared towards sales and when applied to property management are often like putting a square peg into a round hole. 

Having a separate license and separate regulations will be a good thing for all.

The second bill to be heard in committee this past week was SB 125 eviction amendments sponsored by Senator Nate Blouin, (D) Salt Lake City. 

This bill would have removed the provision in Utah law that requires judges to impose treble damages (triple rent) when renters force their operator to do an eviction. In Utah, renters must be given a notice if they fail to pay rent or violate their lease. The notice gives them a certain number of days to correct or resolve the issue or move. If they do neither, the notice instructs them that if their rental operator has to go to court to remove them, there will be a triple penalty.

This law has been tremendously successful and eviction filings in Utah have fallen from over 3% to almost 2% since judges have been required to impose trouble damages. When people understand there are consequences to their actions, they make better choices and resolve lease violations without as many evictions.

We argued that repealing this law would lead to an increase of evictions and ultimately hurt renters. 98% of renters comply with their leases and their notices. Just over 2% force their rental operator to do an eviction. Half of those settle before the judgment and get no treble damages. The one percent eviction rate in Utah, 1/3 to 1/4 of surrounding states like Nevada, Arizona, and Colorado, are people who belligerently refuse to work with their rental operator. They often bury their heads in the sand, refuse to seek help, refuse to negotiate, and force landlords to go through tremendous cost, and grief to remove them. For that behavior, punitive damages of three times, are appropriate.

Senator Blouin’s bill failed five votes against to one for. Special thanks to Nick Lloyd, an attorney for Titan legal who helped explain eviction law and the merits of treble damages to state senators.

Feb. 6, 2025, Attorney Nick Lloyd testifies on SB 125 eviction amendments, sponsored by Senator Nate Blouin (D-Salt Lake City), advocating for key housing policy updates.

Below is this week’s tracking sheet for information on more housing-related bills: